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Sept. 26 -- Federal regulators may be able to assert Clean Water Act
jurisdiction over more waters and wetlands than are now protected on the basis
of a draft scientific study that links all streams and certain wetlands with
larger, downstream navigable waters, attorneys and policy analysts say.

The Environmental Protection Agency's draft study finds that all tributary
streams, including perennial and the previously unprotected intermittent and
ephemeral streams, are physically, chemically and biologically connected to
downstream rivers.

The study, released Sept. 17, also finds that
wetlands and open waters in flood plains of rivers and riparian areas also are
connected in the same way as streams are to downstream rivers.

The
study, however, was unable to generalize that a connection exists between
isolated wetlands and open waters, such as playa lakes and prairie potholes,
that are located outside flood plains and downstream waters. Instead, it said
the EPA and the U.S. Army Corps of Engineers could, on a case-by-case basis,
evaluate whether these isolated wetlands have an aggregate impact on downstream
waters.

The EPA said the study provides the first comprehensive link
between headwater streams, which make up the most abundant type of streams in
the U.S., and downstream navigable waters. The study, which the EPA Science
Advisory Board is now reviewing, will serve as the scientific basis for a rule
developed jointly by the EPA and the corps to clarify Clean Water Act
jurisdiction over the nation's waters and wetlands.

The EPA on Sept. 17
sent a proposed rule to the White House Office of Management and Budget for
interagency review. At the same time, it withdrew draft guidance on the issue
that had been at the White House since 2012 .

Issue of
Jurisdiction

The issue of jurisdiction carries a great deal of
significance. The fact that a water is covered by the Clean Water Act has
implications for permitting of pollution discharges, filling of wetlands and
streams, certifications by states that activities such as dam-building or other
federally permitted activities do not harm water quality and cleanup of oil
spills.

Under the Clean Water Act, the EPA or responsible state
authorities have responsibility for issuing permits under the Section 402
National Pollutant Discharge Elimination System program, while the corps issues
Section 404 dredge-and-fill permits for construction and other development
projects. The EPA oversees the Section 404 program.

Attorneys said the
study could allow the agencies to assert jurisdiction in a blanket fashion over
ephemeral and intermittent streams, rather than force them to try to find a
significant nexus for each non-navigable tributary in question with downstream
navigable waters. The so-called significant nexus test was established by the
2006 U.S. Supreme Court ruling in Rapanos v. United States, 547 U.S. 715, 62 ERC 1481
(2006).

Scientific Justification

Brian Glass, an attorney with
Bryn Mawr, Pa.-based Warren Glass LLP, said the report “is plainly an attempt
to provide scientific justification for finding that certain categories of
waters possess a 'significant nexus' to navigable waters and for asserting
jurisdiction over them.”

Glass added, “I would expect the joint draft
rule that EPA and the Corps submitted to OMB to assert federal jurisdiction
over all tributary streams and all wetlands and open-waters in riparian areas
and floodplains.”

“As you read the tea leaves, that's
exactly the conclusion we believe is likely--that the agencies will use the
draft study to provide the scientific basis to argue all streams should be
considered jurisdictional no matter the size or flow rate, ” Carson said.

Don Parrish, senior regulatory relations director for the American Farm
Bureau Federation, said that “the study appears to give EPA the justification
to regulate all waters, not just those that are navigable waters. That is
contrary to what Congress authorized.”

2008 Guidance

Under
current policy, as set out in joint EPA-Army Corps guidance issued in 2008, Clean Water Act jurisdiction
extends to traditional navigable waters; wetlands adjacent to traditional
navigable waters; non-navigable tributaries of traditional navigable waters
that are relatively permanent, including those tributaries that typically flow
year-round or have continuous flow at least three months of the year and
wetlands that directly abut such tributaries.

As a result of the new
study, the EPA and the corps could propose to bring all wetlands in flood
plains and riparian areas, including those that abut ephemeral and intermittent
streams, under federal protection. Ephemeral and intermittent streams also
could fall under federal protection.

Patrick Parenteau, a professor of
environmental law at Vermont Law School, and Natural Resources Defense Council
attorney Jon Devine pointed out that asserting jurisdiction over waters does
not automatically translate into requiring permits for dredge-and-fill
activities and discharges of pollutants.

“Even if a water is
jurisdictional, there needs to be proof of addition of a pollutant, be it dredge
and fill or discharges, before a state or federal regulator can even require a
permit under the Clean Water Act,” said Parenteau, who was formerly the
regional counsel of the EPA Region 1 from 1984 to 1987.

In general,
Devine said in an e-mail, “an activity typically only triggers Clean Water Act
permitting requirements if it results in an 'addition' of a 'pollutant' from a
'point source' into a 'water of the United States.' ”

Permitting cannot
be sought for waters that aren't under the act's jurisdiction, they said.

Supreme Court Confusion

Asserting jurisdiction over waters and
wetlands and the question of what is considered a water of the U.S. have been
sources of much uncertainty, litigation and confusion because of two U.S.
Supreme Court decisions that attempted to circumscribe Clean Water Act
jurisdiction. The first was Solid Waste Agency of Northern Cook County
(SWANCC) v. U.S. Army Corps of Engineers, 531 U.S. 159, 51 ERC 1833 (2001),
and the second was Rapanos.

The court in SWANCC said the agencies couldn't assert jurisdiction
over geographically isolated wetlands as waters of the U.S. merely because they
served as habitat for migratory birds.

In Rapanos, the Supreme
Court split on defining a standard to establish jurisdiction.

Justice
Anthony Kennedy issued a concurring opinion, which said the agencies must prove
on a case-by-case basis that a particular water or wetland has a “significant
nexus” to a navigable water. Meanwhile, Justice Antonin Scalia's plurality
opinion said the Clean Water Act should apply to waters and wetlands with a
“continuous surface” connection to navigable waters.

Kennedy said he
articulated the significant nexus standard to enable the agencies to assert
jurisdiction over intermittent and ephemeral streams and wetlands without a
direct connection to navigable waters because the two agencies had failed to
promulgate a rule that would clarify and identify which waters fell under
federal protection.

Response to Rapanos

The two agencies have
chosen to use Kennedy's concurring opinion and Scalia's plurality opinion as
the bookends for asserting jurisdiction, first through the 2008 guidance
document and then through the draft guidance in 2011. Developers, builders, and
environmental groups have termed these documents vague and confusing and sought
additional clarification as well as rulemaking.

The confusion also had
an effect on government regulatory policy, according to the EPA Office of
Inspector General.

The inspector general said in an October 2009 report
that the EPA dropped 77 potential Clean Water Act Section 404 cases between
July 2006 and December 2007 because it was uncertain whether it could establish
jurisdiction.

“In some cases, the jurisdictional uncertainty that
resulted from the Rapanosand SWANCC cases makes it unclear
whether a §404 violation has even occurred,” the IG report said.

Significant Nexus Test Not Needed

According to the attorneys, the
draft connectivity study obviates the need for conducting a significant nexus
test on intermittent and ephemeral streams.

“The draft report is clearly
a response to Justice Kennedy's concurrence in Rapanos,” Glass said,
“What the report appears to attempt to do is provide the scientific
justification for a rule asserting blanket jurisdiction over certain broad
categories of waters (tributary streams and wetlands and open-waters in
riparian areas and floodplains) without having to make case-by-case
'significant nexus' determinations for those waters.”

According to
Carson, the main conclusion in the draft study concerning streams and wetlands
and open waters in flood plains makes Scalia's direct, continuous surface
connection test superfluous.

“EPA and the Army Corps may rely on this
conclusion to create a 'bright line' test for regulating all wetlands located
in flood plains and riparian corridors as being 'waters of the United States'
and avoid the need for any 'significant nexus' analysis,” Carson and other
attorneys with Van Ness Feldman wrote in a Sept. 19 issue alert.

One of the key aspects of the study
that is causing much concern among home builders and farmers is the possibility
that geographically isolated wetlands and waters located in uplands could be
considered waters of the U.S. if regulators were able to demonstrate that those
upland waters have a cumulative impact on downstream navigable waters.

Those waters were deemed not to be under Clean Water Act protection by the
EPA and the corps in a 2003 memorandum following the SWANCC decision.

Wetlands Data Insufficient

The draft connectivity study finds the
data are insufficient to conclusively link isolated wetlands--though they
provide flood retention and nutrient and sediment trapping benefits--to
downstream waters. However, the study suggests that the agencies could evaluate
these wetlands individually or consider their cumulative impact on downstream
waters on a case-by-case basis.

Glass said he would not be surprised if
the forthcoming rule proposed a set of factors for determining whether all
other wetlands possess sufficient connectivity to downstream waters to assert
federal jurisdiction over them.

Those factors would most likely be
challenged in court, where the key question would turn on whether this study
provides the necessary scientific justification to satisfy the significant
nexus standard set by Kennedy, he said.

Devine said he expects there
will be much discussion on the impact of waters that are physically removed
from flood plains.

“Where all of the available science supports a
finding that any of these kinds of waters collectively have a meaningful impact
on other waters, they must be protected,” he said.

Parenteau doesn't
expect the EPA will make prairie potholes--freshwater marshes found in the
Upper Midwest that provide the benefit of absorbing snowmelt and
floodwaters--jurisdictional, even in the aggregate. Instead, he said, he
expects the EPA will consider such waters on an case-by-case basis.

Devine said the study, after being fully vetted by independent scientists,
would provide the science for a rule that would resolve the uncertainty over
which waters are protected. Moreover, “such a rule would remedy the current
approach to law enforcement, for instance, where officials have largely
abandoned efforts to enforce the law in the headwaters of watersheds,” he
said.

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